Tag Archives: measurement

Recap of 2009…and Look Forward to 2010

20 Dec

Hard to believe, but it’s been a year plus since I launched the brandcentric blog.  Many lessons learned about the art and science of blogging (mostly positive), and still a lot more to discover.

On the content front, this has been a fantastic opportunity to refine my focus in this bold, new era of CPG marketing.  A few of the more meaningful themes from the past year include:

  • The expanding share-of-wallet that digital media has claimed from traditional media vehicles.  CPG was slow to adopt, but quick to catch up to (and potentially surpass) other industries.
  • The coming-of-age of social media and marketing for CPG brands.  Word-of-mouth makes a lot of sense for considered purchases, even in the world of fast-moving consumer goods.
  • Leveraging applied math and modeling techniques to achieve superior merchandising strategies.  The data is available, the science is mature and business-user applications are available through a browser.
  • The relentless pursuit of developing, nurturing and monetizing direct-to-consumer relationships.  Alice.com was unexpected, but is exciting to watch.

As I look forward to 2010, a few early focus areas bubble to the top:

  • Shopper centricity.   This will be huge across several fronts, including in-store marketing, trade planning, and broader merchandising strategic planning.   Retailers are ready to unleash the data and shopper segmentation, and manufacturers need to step up to the plate.  Collaborative planning has made a comeback.
  • Pricing.  Commodity and ingredient cost volatility is expected to rear its ugly head once again.  The focus on promoted shelf price is more important than ever, especially when considering issues like gap to private label and the incredibly elusive consumer.  Expect manufacturers to funnel more marketing dollars to price as a strategic marketing lever.
  • Digital integration.  Will this be the year that digital media and marketing shifts from a “center of excellence” service to a brand-driven strategic capability?  For some brands not quite yet, but for others absolutely.

There are many more themes that are percolating.  I’d love to hear what’s on your mind as you look forward to the coming year.

Targeting Green Consumers

20 May

 

It seems every major CPG manufacturer has jumped on the green bandwagon with environmentally friendly packaging, business practices and even new brand platforms.  But does this flight to greener pastures actually return an investment?  Is the brand reaching the right consumer and shopper demographic?  Experian’s GreenAware servicehelps marketers answers these questions and more.  Experian has developed a consumer segmentation around four tiers of “greeness”, allowing marketers to uncover opportunity areas and directly reach the greenest consumers.

It’s exciting to see very targeted one-to-one marketing make a big push in to CPG-land, but my experience to date is that not all CPG marketing organizations are very well set up to take action.  Some very large manufacturers don’t have a central team that “owns” the database.  Consequently, marketing programs deliver excellent, fresh consumer data that often goes stale.  Conversely, some smaller, more nimble CPG marketing organizations I have worked with have the right people, tools and processes in place to scale relationship marketing programs.  Scary, but true.

Making Points-Based Rewards Programs Really Work

17 Feb

pitcrewI’ll come right out and say that I am an avid supporter of points-based rewards programs for CPG brands.  If planned and executed properly, rewards program can reach your most valuable consumers and measurably drive incremental volume.  At SoftCoin, we designed and implemented a number of highly successful rewards programs for Welch’s, NASCAR, Nestle, DPSG, P&G and others.  These programs were engaging, reached a mass market audience, and were rich with data and insights.

But for any CPG marketer pondering a points program, there are three things you’ll want to make sure you really get right: optimizing purchase validation, assembling a solid rewards catalog and mining the database.

The most scalable method to validate purchase is via secure, on-pack alphanumeric codes.  Sure, there is an up-front capital investment in equipment to apply the codes (~$25k to $100k) and there will likely be a short-term disruption to the production line, but this is really the way to do it.  The MyCokeRewards program has been using secure on-pack codes for 3+ years now, so the business case exists.  Other methods include tracking purchases through a store club card (doesn’t scale beyond that one retailer) or via credit card data (bad if you are strong in C-store distribution given the bias toward cash transactions).  And whatever you do, don’t digress with mail-in UPC code redemption.

The rewards catalog must be relevant and compelling to get your best consumers excited about participating.  There should be a mix of digital asset rewards (music, special content) and some cool aspirational prizes.  There should also be enough redemption opportunities to keep consumers engaged, without breaking the bank so to speak.  NASCAR offered a highly coveted “pit crew captain for a day” reward that money simply can’t buy along with a number of other lower level digital assets.  Talk about resonating with a core audience and really driving consumption.

Finally, solid analytics and segmentation are essential to getting the most out of these programs and driving the right behaviors.   Big CPG points programs can easily attract 2 million+ unique / authenticated consumers, so expect to see a broad array of behaviors.  A core set of heavy users (as measured by code entries and/or self-reported survey response), will sit alongside a  long tail of single code entry consumers.  Developing the right analytical framework to reward heavy consumers for their loyalty and encourage casual consumers to buy more is essential.  Brandweek recently highlighted that loyalty program participants are 70% more likely to actively recommend a product, so segmenting and supporting the brand champions is key.

Web-based loyalty programs are excellent vehicles for CPG brands to drive, measure and reward consumer behavior.  If designed properly, these programs can deliver profitable results.  Just pay attention to these three key areas before moving too far down the path of execution.

In-Store Marketing Takes a Hit

29 Jan

snowballWell, it was over before it really even started.  This week’s announcement that Nielsen has suspended the PRISM in-store data program was unexpected, but not terribly shocking.  The goal of PRISM was to define generally accepted metrics for in-store marketing and merchandising along with syndicated data from a network of participating retailers.  This program would have set the stage for a massive reallocation of marketing dollars from traditional media to in-store activities.  CPG marketers, including Procter & Gamble were very excited about the prospects for PRISM and the in-store visibility it would finally provide to the industry.

That was until Walmart unceremoniously backed out of the program last month.  This single move took the wind out of the sails for Nielsen’s ambitious plans.  Getting this program off the ground without Walmart will be difficult at best, given that many manufacturers source up to 25% or more of volume through this single retailer.

So where does this leave an industry that desperately needs deeper in-store marketing and merchandising visibility?   Continuing to throw dollars at legions of in-store merchandising audit teams doesn’t scale and isn’t cheap.  Inferring in-store compliance from the patchwork of retail POS and syndicated market data won’t deliver a consistent, comprehensive set of causals to rely on.

Ultimately innovation will prevail and save the day.  Perhaps an idea like Store Eyes, which I blogged about recently, will provide that right balance of rich store-level data in an affordable and scalable fashion.  I sure hope someone capitalizes on this opportunity, and real soon.

Keeping brands on course in a down economy

23 Dec

2008cornLike all good marketers ought to do, I wrote the obligatory contributed story on what this challenging economy means for CPG brand health.  Specifically, my call to action was to apply more rigor and science to the trade promotion planning process.  Doing so is both good brand hygiene and also a likely long-term competitive hedge against private label.  You can find the published story on the Journal of Trading Partner Practices website.

On a side note, as this story went to press commodity food ingredient costs started to tumble back to reality after unprecedented gains in the first half of 2008.  But the same rationale for a better planning process still applies, even in a highly volatile cost environment.  The price hikes that P&G, ConAgra and Kraft were all forced to make in the first half of the year have yielded price decrease decisions that require the same analytical rigor.

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